Finance & DevelopmentSTR, TE Downgrade U.S. Hotel Forecast in Final Revision of 2024

STR, TE Downgrade U.S. Hotel Forecast in Final Revision of 2024

NASHVILLE—STR and Tourism Economics ​downgraded the growth rate in the final U.S. hotel forecast revision of 2024.

For 2024, projected gains in average daily rate (ADR) and revenue per available room (RevPAR) were each downgraded, -0.5 percentage points to +1.5 percent and down 0.6 percentage points to +1.4 percent, respectively. Occupancy for the year was lowered 0.1 percentage point to 62.9 percent, after the previous forecast projected the metric to remain steady from 2023. For 2025, the occupancy growth projection was downgraded 0.4 percentage points, and the forecast for ADR and RevPAR increases were lowered to +1.6 percent and +1.8 percent, respectively.

“The outlook for 2025 remains somewhat in flux, with positive sentiment potentially offset by the higher cost of living,” said Amanda Hite, STR president. “Based on current economic conditions, higher-end hotels will continue to drive industry performance. The change in the presidential administration is anticipated to yield stronger economic conditions at first, which is not yet reflected in the data.”

“Looking ahead to next year, the economic drivers are supportive of growth in travel activity. Consumer spending and business investment are expected to expand, helping support additional gains in business and group travel demand. Growth in international visitation also represents a tailwind for 2025,” said Aran Ryan, director of industry studies at Tourism Economics. “The forecast was prepared pre-election and assumed economic conditions consistent with political status quo.”

“Annual GOP and EBITDA margins remain unchanged from the previous forecast, both expected to improve slightly year over year,” said Hite. “For 2025, higher growth is projected across both metrics due to lower labor costs, with inflation-adjusted GOP forecasted to inch closer to 2019 levels.”

RELATED ARTICLES

Keeping a Constructive Tax Policy: AHLA Fights to Preserve Tax Provisions That Protect Small-Business Owners

The Tax Cuts and Jobs Act (TCJA), enacted in 2017, made changes to the tax code that have delivered significant benefits to the hotel...

TownePlace Suites by Marriott Hotel Opens in Duluth

CORALVILLE, Iowa—Kinseth Hospitality Companies (KHC), in partnership with the Duluth Chamber of Commerce and the Hermantown Chamber of Commerce, announced the opening of the...

Green Key Global Expands its Sustainability Portfolio With Launch Of Green Key Ready

WASHINGTON—One year after the American Hotel & Lodging Association (AHLA) and the Hotel Association of Canada (HAC) united to co-own and operate Green Key...

Accor Drives Growth and Performance in New Signings for 2025

PARIS, France—Accor shared an overview of its 2024 development activity and growth prospects for 2025. In 2024, Accor expanded its portfolio with the opening...

Hotel Seville Nomad Transitions to Hyatt’s Unbound Collection

CHICAGO, Illinois—Allen Gross, chairman of GFI Hospitality, announc­­­ed the transition of the former James NoMad Hotel to Hotel Seville NoMad, joining the Unbound Collection...

My Place Hotel-Savannah Airport/Pooler Opens

ABERDEEN, South Dakota—My Place Hotels of America has announced the opening of My Place Hotel-Savannah Airport/Pooler, Georgia, in Pooler, Georgia. The hotel is owned...